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LTD: end of the year and payroll correction

Payroll error - end of the year due. how to journal payment to hmrc made after tax return

Greetings everyone,

I am preparing my books for an LTD’s end of the year and I have encountered a mistake I have made in 17-18 tax year with payroll.

By mistake, when deducting training money from an employee, I have ticked the box to deduct the money from the gross wage, before NI and tax.
I know I can reopen the payslip, correct the error and submit an Early Year Update.
The difference would result in £2.93 Employee NI underpayment that will obviously increase my tax bill for that quarter with that exact amount (I am paying PAYE quarterly)

By doing this I have 2 important questions:

I know I have to pay HMRC straightaway to avoid penalties, but what reference number shall I use? Shall I use the same 17 digits reference number I’ve used to pay PAYE for that period?

This is the most important question:

As I am preparing my books for the end of the year, how can I include the £2.93 payment?
The liability was created last year but the payment will be done in the next year, after the end of the year date.

Thank you

Replies

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11th Jan 2019 15:35

Eh? You won't include the payment because it hasn't been made before the year-end. It remains as a creditor in the books until it's paid. What other option were you thinking of?

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11th Jan 2019 15:47

That was my problem that I could not find a way.
In my opinion was just: I will file my accounts with a £3 liability for 2017-2018 even though I have paid the difference.
And I thought that this will be a problem, leaving HMRC and PAYE accounts on a credit.
I think after reading your reply, it makes sense now.
It will be a creditor which was paid in the next year.
Thank you

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to testmail0689
11th Jan 2019 15:53

That is the nature of a creditor. It is something that is owed at the balance sheet date and paid later.

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to andy.partridge
11th Jan 2019 16:06

I thought that its alright to have a supllier as a creditor for example but not HMRC and they will look at it as unpaid PAYE because its in my chart of accounts.
Now it's clear, thank you for clarifying this to me.

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to testmail0689
11th Jan 2019 16:09

There are many different types of creditor, but unpaid supplier accounts that you mention fall under the heading 'trade creditors'.

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12th Jan 2019 16:58

Not sure anyone's going to be bothered about £2.93.

Sleep easy.

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to lionofludesch
12th Jan 2019 17:29

There’s a guy just starting out in practice and looking for PI cover who is.

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to andy.partridge
12th Jan 2019 17:37

I spotted him.

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